On the Oral Arguments in South Carolina

Your Curmudgeon watched the arguments in the case of Bishop Lawrence and his diocese and parishes against the Episcopal Church and the Episcopal Church in South Carolina yesterday, and reviewed the tape carefully once again as archived. The event must have seemed dispiriting to those who supported the trial court’s decision, because Judge Goodstein came in for a substantial amount of criticism for excluding evidence that ECUSA wanted to put on — as it was able to do in San Joaquin, Quincy, Fort Worth and Pittsburgh — concerning its “hierarchical” structure. Indeed, much of the argument seemed to dwell upon whether the national Church should be deemed hierarchical, and if so, whether that classification would make a difference to the outcome. And that is precisely where ECUSA and its attorneys wanted to focus it. (How they succeeded in pulling off that strategy will be the subject of my following post.)

For ECUSA and its attorneys, the world of church property law began and ended with Watson v. Jones, an 1872 decision by the United States Supreme Court that, among other irrelevant observations (called “obiter dicta”, or “things said beside the point”), offered the view that the then-established Protestant Episcopal Church in the United States of America was hierarchical. The opinion furnished no analysis or justification for that observation, but simply included PECUSA in a group of churches that the Court contrasted with those it termed “congregational.”

For the Court in Watson, the distinction meant this. In a hierarchical church, consisting nationwide of many branches under a central religious government, there would be a supreme adjudicatory body with the power to make decisions on matters of church law and polity that were binding on each and every local branch of the church, and the civil courts were required by the First Amendment to defer to such binding adjudications in any disputes that came before them. In a congregational church, by way of contrast, there was no kind of higher authority beyond the congregation itself, and so a decision by the majority of the congregation was binding on all of its members.

The United States Supreme Court gradually moved away from its holding in Watson, without actually overruling it. As more and more courts saw that deference to a hierarchical church judicatory would result in a victory for the hierarchical church authorities in every case, there began to arise a resistance to giving that category of churches a pass, as it were, on all constitutional issues, and thereby to allow them to govern their members in ways that no other church could. The tendency of the deference rule, in other words, was to favor one class of churches over all the others, and that smacked of “establishing” the hierarchical churches in a manner forbidden by the First Amendment.

In contrast, there was developed a so-called “neutral principles of law” approach, by which churches were treated just like private persons in respect to holding property. By making no distinction in its rules, the neutral principles system guaranteed that all deeds, contracts and other documents affecting title would be interpreted the same, without regard to the person or the Church that created them.

The Episcopal Church’s Dennis Canon provides a perfect illustration of this contrast. Cases which hold that ECUSA is “hierarchical” allow the Church to enforce in the civil courts, against individual member parishes, its Dennis Canon — a mandatory trust that keeps a parish from ever leaving the Church, on pain of surrendering all of its real and personal property to the diocese to which it belongs. Such courts enforce the Canon despite the fact that those parishes never signed or recorded any documents placing their individual real and personal property into a perpetually binding trust. These cases stand for the proposition that hierarchical churches do not have to trouble themselves with complying with State law requirements for the creation of trusts (such as the Statute of Frauds, which requires a trust document be signed by the person owning the property being placed into a trust).

Other churches, to achieve the same result, could do so only by making each individual parish sign and record the appropriate trust papers. But hierarchical churches were free to impose a trust all at once, by fiat, on all parish properties simultaneously. And many trust attorneys believe that such an exemption from the requirements of State law creates an issue under the First Amendment’s Establishment Clause.

The Episcopal Church has nothing it can point to by way of language in its governing documents which renders the property of a Diocese (as opposed to that of a parish) subject to any kind of trust in its favor. The South Carolina case involves an entire Diocese of the Church that amended its governing documents so as to secede from ECUSA, and along with it came nearly forty individual parishes that were members of the Diocese. Faced with these moves, ECUSA first argued that even though the parishes had left with their Diocese, the Dennis Canon still meant that they could not keep their property. And as for Bishop Lawrence and his incorporated Diocese, it argued that it had removed him from his office and appointed a new bishop in his place who had the authority to take it over, and take possession of all diocesan property.

In the South Carolina Supreme Court yesterday, ECUSA’s attorney argued exclusively for deference to it as a “hierarchical” church. (Never mind that the only true hierarchical relationships in ECUSA are between a diocesan bishop and his subordinate clergy, and in some cases between an individual member parish and its governing diocese. There is no body within ECUSA — not its General Convention, its Presiding Bishop, or its Executive Council — which can order or make a Diocese to do anything which that diocese does not choose to do. The relationship between the national Church and its dioceses is thus voluntary, for as long as the parties want to continue it, and may be dissolved at any time by taking the appropriate steps to amend the diocese’s governing documents. The national Church, again, has no power to prevent a Diocese from so amending its governing documents.)

To do so, he had to blur the distinctions in the cases dealing with individual parishes — and he had to ignore the Quincy case altogether (which was not even mentioned in argument). In doing so, he received substantial assistance from Associate Justice Kaye Hearn, as I will detail in my next post.

Two other Justices (who did not take part in the 2009 All Saints Waccamaw decision) seemed to be taken in by the confusion created by all the discussion of hierarchy and the effect to be given to the Dennis Canon. Justice Beatty, who did join in the 2009 decision, was largely noncommittal, and spoke the least of any Justice.

That left Chief Justice Toal, who despite all the tortuous arguments stuck to basic legal principles and analysis: a trust needs a settlor to be created, and the beneficiary of a trust is perfectly within his rights to quitclaim back to the settlor all of his supposed interest in the trust. (There was thus no “breach of the Dennnis Canon” when Bishop Lawrence signed individual quitclaim deeds to his parishes, on behalf of the Diocese as beneficiary of any trust interest that arguably may still have existed following the All Saints Waccamaw decision.) And South Carolina religious corporations are free to amend their governing documents — including a complete change in their charitable purpose — as long as they comply with the formalities required by South Carolina law.

To this observer, it seemed as though the Justices had not discussed the case with each other beforehand. And it also looked as though the Chief Justice had taken on the responsibility of writing an opinion in the case — since she was the one most weighed down with case files and briefs. But whether her opinion will be the majority one remains to be seen. I believe she has the confidence of Justice Beatty, who followed her before. And she may have Justice Kittredge in her camp, as well.

But both he and Justice Costa Pleicones seemed to have difficulty following the ins and outs of the arguments — thanks to the constant interjections by Justice Hearn on behalf of the Church of which she is an active member. She practically monopolized the argument with long speeches (not questions) that would have sounded more appropriate had they come from ECUSA’s attorneys. The resulting final impression of Mark Lawrence and his Diocese having had a rough time in the Court is almost entirely, in my estimation, due to the attempts by Justice Hearn to derail the case by returning South Carolina to the days of deference, as ECUSA argued in its briefs.

Whether her unprofessional and entirely partial tactics will succeed is a question that will have to await the Court’s opinion, which could be months away. I shall have much more to say about those tactics in my following post.*

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